US­ING CLAIMS DATA TO IDEN­TIFY HEALTH­CARE WASTE­FUL SPEND­ING

Mil­li­man MedIn­sight ® Health Waste Cal­cu­la­tor

Modern Healthcare - - Late News - ANIKIA NEL­SON, MD CLIN­I­CAL PROD­UCT MAN­AGER, MEDIN­SIGHT MIL­LI­MAN

Health­care waste—de­fined as tests or pro­ce­dures that don’t im­prove health—ac­counts for a large pro­por­tion of med­i­cal care, with some ex­perts, such as the Na­tional Academy of Medicine, es­ti­mat­ing that onethird of all health­care dol­lars are mis­spent. In fact, us­ing the Mil­li­man MedIn­sight ® Health Waste Cal­cu­la­tor, the Wash­ing­ton Health Al­liance showed that 45% of uti­liza­tion for a co­hort of 47 health­care ser­vices could be con­sid­ered waste­ful. That equates to an es­ti­mated $282 mil­lion.

HOW DOES MIL­LI­MAN’S MEDIN­SIGHT ® HEALTH WASTE CAL­CU­LA­TOR DEFINEWASTEFUL“SPEND­ING”?

AN: The way we iden­ti­fied ac­tual “waste” was by ask­ing, “Is this ser­vice sup­ported by ev­i­dence; is it truly nec­es­sary in this con­text; is it not du­plica­tive; and is it as free from harm as pos­si­ble?” To an­swer those ques­tions, our con­sul­tants looked to ex­perts such as the Amer­i­can Board of In­ter­nal Medicine and the U.S. Pre­ven­tive Ser­vices Task Force to see what they con­sider waste­ful health­care ser­vices. Then we an­a­lyzed claims data for 2.4 mil­lion in­sured Wash­ing­to­ni­ans us­ing the Health Waste Cal­cu­la­tor, our ev­i­dence-based claims anal­y­sis tool that clas­si­fies health­care ser­vices as high value and low value in the con­text of care.

WHAT WERE THE FIND­INGS OF THIS WASTE ANAL­Y­SIS FOR WASH­ING­TON?

AN: One clear find­ing of our anal­y­sis was that as a cul­ture, we’re do­ing too many need­less pre­op­er­a­tive tests for lowrisk surg­eries on oth­er­wise healthy adults. For ex­am­ple, we do a lot of lab­o­ra­tory stud­ies, EKGs, chest X-rays, and pul­monary func­tion test­ing for low risk pa­tients be­fore low risk surg­eries. In many cases, th­ese types of tests don’t ac­tu­ally in­form the care, yet can de­lay nec­es­sary pro­ce­dures and re­sult in a cas­cade of un­nec­es­sary tests. This one mea­sure alone im­pacts well over 100,000 peo­ple a year in Wash­ing­ton State, cost­ing pa­tients and in­sur­ers tens of mil­lions of dol­lars.

DID ANY OF THE FIND­INGS FROM THIS WASTE ANAL­Y­SIS SUR­PRISE YOU?

AN: One of the find­ings was that the ma­jor­ity of the waste came from low-cost, com­monly used ser­vices rather than high-cost ser­vices. In­sur­ers fo­cus a lot of at­ten­tion on high-cost, low-fre­quency ser­vices, while this anal­y­sis shows there is value in try­ing to elim­i­nate un­nec­es­sary low-cost items as well. While many qual­ity im­prove­ment ef­forts aim at in­creas­ing ac­cess to care (for ex­am­ple, in­creas­ing dis­ease screen­ing), the Health Waste Cal­cu­la­tor shows that also de­creas­ing overuse (for ex­am­ple too fre­quent screen­ing or screen­ing the wrong pop­u­la­tion) has the po­ten­tial to re­duce un­nec­es­sary spend­ing and pro­tect pa­tients from un­nec­es­sary harm.

HOW DOES THE HEALTH WASTE CAL­CU­LA­TOR WORK?

AN: In the Wash­ing­ton Health Al­liance project, the Waste Cal­cu­la­tor looked at 47 mea­sures for ser­vices iden­ti­fied by the Amer­i­can Board of In­ter­nal Medicine’s Choos­ing Wisely ® ini­tia­tive as po­ten­tially waste­ful pro­ce­dures and tests -ser­vices that are ei­ther du­plica­tive, harm­ful for pa­tients, or that the ev­i­dence shows are not nec­es­sary. The Health Waste Cal­cu­la­tor coded those rec­om­men­da­tions so that clients can quan­tify those ser­vices based on claims data. The Health Waste Cal­cu­la­tor combs through claims look­ing for cer­tain ser­vices and, based on cri­te­ria and ev­i­dence it finds, it cat­e­go­rizes ser­vice as not waste­ful, likely waste­ful or waste­ful and quan­ti­fies the op­por­tu­nity by cat­e­gory of waste.

HOW EF­FEC­TIVE IS THE HEALTH WASTE CAL­CU­LA­TOR AT IDEN­TI­FY­ING WASTE?

AN: Typ­i­cally, the Health Waste Cal­cu­la­tor iden­ti­fies around 1% to 3% of to­tal health­care spend­ing as waste. While that may not seem like a lot, in a world where health in­sur­ers are look­ing for in­cre­men­tal sav­ings op­por­tu­ni­ties, this is a huge op­por­tu­nity. In ad­di­tion to iden­ti­fy­ing real sav­ings, the Health Waste Cal­cu­la­tor also helps raise our col­lec­tive health IQ around when tests and pro­ce­dures are worth­while ver­sus when they are waste­ful or may even cause harm to the pa­tient.

WHAT CAN PAY­ERS AND AT-RISK PROVIDERS DO DIFFERENTLYAS A RE­SULT OF THE FIND­INGS OF THE HEALTH WASTE CAL­CU­LA­TOR?

AN: At its core, the Health Waste Cal­cu­la­tor en­ables pay­ers and providers to iden­tify un­nec­es­sary tests and pro­ce­dures, which is im­por­tant in­for­ma­tion they can use in de­sign­ing pro­grams aimed at re­duc­ing waste. The re­sults can also be used to iden­tify providers who prac­tice more ef­fec­tively by avoid­ing un­nec­es­sary uti­liza­tion. That in­for­ma­tion can be used in steer­age and re­fer­ral pro­grams. Providers can gain aware­ness of their own pre­scrib­ing habits and best prac­tices. Re­duc­ing un­nec­es­sary and waste­ful health­care uti­liza­tion and as­so­ci­ated costs is es­sen­tial to en­sur­ing we have a sus­tain­able health­care sys­tem. Prod­ucts like the Health Waste Cal­cu­la­tor are an im­por­tant step for­ward in that fight.

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